Question

Each week, Jim places an order for bananas to be delivered at Zingos grocery store at a cost of $ 0.30 per pound. Zingos sell these bananas for $ 0.70 per pound. Any unsold bananas at the end of the week are donated to a local charity. Jim needs to decide between ordering 200, 500, or 800 pounds of bananas for the week. Assume the weekly demand for bananas will be 200, 500, or 800 pounds.
a. Construct a decision table including the payoffs for each combination of order quantity and demand.
b. Use the maximax criterion to decide how many pounds of bananas Jim should order.
c. Use the maximin criterion to decide how many pounds of bananas Jim should order.
d. Use the equally likely criterion to decide how many pounds of bananas Jim should order.
e. Use the minimax regret criterion to decide how many pounds of bananas Jim should order.
f. Use the Hurwicz criterion using α = 0.3 to decide how many pounds of bananas Jim should order.